Is CapTrader Regulated? Is it safe? - TU Expert review
License is the most important document you have to consider when choosing a broker. Many traders, who would like to start working with CapTrader try to check whether it is regulated. Traders Union experts have already done that. In this article, you will learn whether CapTrader is regulated, what regulatory authorities supervise the broker and whether it is safe to work with the company in general.
Short summary about the broker CapTrader
CapTrader is a Forex broker, which was founded in Germany in 1997. The company is headquartered in Dusseldorf. CapTrader is an Introducing broker to Interactive Brokers. The platform uses Interactive Brokers software, which is why the brokers have identical user accounts, trading platforms and products. CapTrader provides access to 7 categories of assets and trading instruments: Forex, commodities, stocks, ETFs, futures, options and CFDs. The company is regulated by the Federal Financial Supervisory Authority (BaFin, 10156708). In addition it is an introducing broker and the European licenses from the regulators of Ireland and the UK (208159) held by Interactive Brokers apply to it as well.
| 💰 Account currency: | EUR, GBP, USD, CHF, CZK, PLN, DKK, NOK, SEK |
|---|---|
| 🚀 Minimum deposit: | USD 2,000 |
| ⚖️ Leverage: | from 1:5 (on CFDs on stock indices), up to 1:20 (on CFDs on stocks) |
| 💱 Spread: | from 0.3 pips |
| 🔧 Instruments: | Currency pairs (105), stocks (7,100), ETF (13,000), options (33), futures (32), CFD |
| 💹 Margin Call / Stop Out: | 100%/50% |
Pros and cons of CapTrader
👍 Advantages of trading with CapTrader:
•Partnership with a well-known broker – International Brokers.
•Access to 145 global stock markets.
•70,000+ trading instruments.
•3 types of trading platforms.
•Access to analytical service Trading Workstation.
👎 Disadvantages of CapTrader:
•High minimum deposit – $2,000 or an equivalent.
•Limited education options.
•Technical support is available 24/5.
Why is it important to work with a regulated broker?
License is a document that certifies that a broker operates legally and guarantees fulfillment of its obligations to the traders. A financial license is issued by a financial regulatory authority of a country (the National Bank) or a specialized authority (for example, Securities Commission, Futures Trading Commission, etc.). It is important to choose licensed brokers for the following reasons:
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A license guarantees that the broker operates in compliance with the rules of the financial regulator that issued the document.
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In order to obtain the license, a broker must comply with certain requirements, for example, the size of the authorized capital or personnel qualification. It is simply not lucrative for scammers to comply with such requirements.
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A broker’s license provides access to real markets, and you can be sure that the quotes are real and up-to-date.
The best option is to work with a broker that holds the license of the jurisdiction, where the trader resides. You can also choose a company with a financial license of another reliable jurisdiction, for example, the U.S. or the European Union.
Is CapTrader Regulated? Broker’s license
Security (Protection for Investors)
CapTrader was founded in Germany and continues to operate there in 2021. The company’s headquarters are located in Dusseldorf. The company operates on the Introducing Broker program by Interactive Brokers and is regulated by the same regulators and the same licenses.
In particular, CapTrader operates in the UK on the FCA licenses No. 208159. The operation in other countries is regulated by the financial institution of Ireland – Central Bank of Ireland, license No. C423427. The company is also registered and regulated by the German regulator BaFin.
👍 Advantages
- The funds of the clients are separated from CapTrader’s capital and are kept on segregated bank accounts
- Negative balance protection
- In the broker violates the obligations envisaged by the offer, the client can file a complaint with the regulator
👎 Disadvantages
- Opening an account requires provision of detailed financial information
- It is impossible to deposit and withdraw funds without verification
- Limited choice of electronic payment systems for deposit and withdrawal transactions
Brokerage fees
Broker’s regulation is the most important choice criterion. However, before you start working with the broker, it is also important to analyze its commissions and fees. TU analysts have studied the commissions and fees charged by CapTrader, which you can see below.
Traders Union experts have analyzed trading and non-trading commissions of CapTrader. The broker offers one account type, which is why the clients pay the same commissions. The spread of 0.3 pips is applied to the currency pairs. However, there is a minimum commission – USD 3.75 or an equivalent amount in another currency per trade. There is also an inactivity fee – USD 1 per each month of inactivity. There are withdrawal fees as well. For the first withdrawal, the broker charges EUR 8 fee and for each next one – EUR 1.
| Account type | Spread (minimum value) | Withdrawal commission |
| Standard | From $3.75 | Yes |
Conclusions
CapTrader can certainly be considered a reliable broker. The company operates on the license that was issued by a reputable jurisdiction. The broker has a good reputation and offers attractive trading conditions. This makes CapTrader a good choice for traders.
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FAQ
How difficult is it to obtain a brokerage license?
The procedure for obtaining a license differs depending on the jurisdiction, but it is very difficult and expensive to get the document in a reliable jurisdiction. This is why only reliable brokers obtain licenses.
Why is it not recommended to work with offshore brokers?
Offshore brokers have to meet minimum requirements for obtaining a license and reporting, which is why often scammers get such licenses.
Can an offshore broker be reliable?
Yes, although there are not many of such brokers. There are brokers with a good reputation, but with an offshore license. You still need to be very cautious when working with such companies.
How do I check a broker’s reputation?
In order to check a broker’s reputation, you need to read user reviews. However, it is recommended to only use independent websites for that.
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Team that worked on the article
Mikhail Vnuchkov joined Traders Union as an author in 2020. He began his professional career as a journalist-observer at a small online financial publication, where he covered global economic events and discussed their impact on the segment of financial investment, including investor income. With five years of experience in finance, Mikhail joined Traders Union team, where he is in charge of forming the pool of latest news for traders, who trade stocks, cryptocurrencies, Forex instruments and fixed income.
Olga Shendetskaya has been a part of the Traders Union team as an author, editor and proofreader since 2017. Since 2020, Shendetskaya has been the assistant chief editor of the website of Traders Union, an international association of traders. She has over 10 years of experience of working with economic and financial texts. In the period of 2017-2020, Olga has worked as a journalist and editor of laftNews news agency, economic and financial news sections. At the moment, Olga is a part of the team of top industry experts involved in creation of educational articles in finance and investment, overseeing their writing and publication on the Traders Union website.